What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2023-11-07 compared with 2023-08-08 · 124 added, 85 removed, 218 unchanged (49% of the section changed)

19 unchanged sentences

Sales of our probe cards and analytical probes are included in the Probe Cards segment, while sales of our probe stations, metrology systems, thermal systems and cryogenic systems are included in the Systems segment.

We generated net income of $2.2 million in the first six months of fiscal 2023 as compared to $60.1 million in the first six months of fiscal 2022.

On September 18, 2023, we announced entry into a definitive agreement to sell our FRT Metrology (“FRT”) business for $100 million in cash, subject to customary purchase price adjustments.

See Note 4, Assets Held-For-Sale Divestiture , for further details of the divestiture.

FRT is a leading supplier of high-precision metrology solutions for the Advanced Packaging and Silicon Carbide markets, and produces metrology systems that are included in the Systems segment results.

On November 1, 2023, we closed on the sale of FRT to Camtek and received cash proceeds of $103.8 million after preliminary adjustments with respect to cash, indebtedness, and working capital.

We generated net income of $6.5 million in the first nine months of fiscal 2023 as compared to $64.5 million in the first nine months of fiscal 2022.

The decrease in net income was primarily due to a decline in revenues and the associated decline in gross margins and higher operating expenses.

The first half of fiscal 2022 was strong, realizing $60.1 million of the $64.5 million net income for the first nine months of fiscal 2022, followed by the semiconductor industry weakness that began in the third quarter of fiscal 2022 and has continued into the nine months ended September 30, 2023.

Significant Accounting Policies and the Use of Estimates

1 unchanged sentence

Actual results in these areas could differ from management’s estimates.

During the six months ended July 1, 2023, there were no significant changes in our significant accounting policies or estimates from those reported in our Annual Report on Form 10-K for the year ended December 31, 2022, which was filed with the Securities and Exchange Commission on February 24, 2023, except for:

During the nine months ended September 30, 2023, there were no significant changes in our

significant accounting policies or estimates from those reported in our Annual Report on Form 10-K for the year ended December 31, 2022, which was filed with the Securities and Exchange Commission on February 24, 2023, except for:

Government Assistance

3 unchanged sentences

The Grant is included in our Condensed Consolidated Balance Sheets within Deferred grant and we have elected to recognize the Grant when earned as an offset to Cost of revenues and Operating expenses within our Condensed Consolidated Statements of Income.

We have elected to present the proceeds from the Grant as cash provided by operating activities within our Condensed Consolidated Statements of Cash Flows as the Grant is to offset operations.

We have presented the proceeds from the Grant as cash provided by operating activities within our Condensed Consolidated Statements of Cash Flows as the Grant is to offset operations.

Results of Operations

The following table sets forth our operating results as a percentage of revenues for the periods indicated:

Three Months Ended Six Months Ended

2023 June 25,

Three Months Ended Nine Months Ended

September 30,

2023 September 24,

2022 September 30,

2023 September 24,

Revenues 100.0 % 100.0 % 100.0 % 100.0 %

5 unchanged sentences

Total operating expenses 38.8 32.2 38.2 30.9

Operating income (loss) (0.8) 16.0 (0.4) 16.7

Operating income 1.6 2.2 0.3 12.2

Interest income, net 0.9 0.3 0.9 0.1

1 unchanged sentence

Income before income taxes 3.0 3.1 1.4 12.6

Provision (benefit) for income taxes (0.1) 1.5 (0.1) 1.9

Provision for income taxes 0.5 0.7 0.1 1.5

Net income 2.5 % 2.4 % 1.3 % 11.1 %

Revenues by Segment and Market

Three Months Ended Six Months Ended

2023 June 25,

Three Months Ended Nine Months Ended

September 30,

2023 September 24,

2022 September 30,

2023 September 24,

(In thousands)

3 unchanged sentences

Three Months Ended

2023 % of Revenues June 25,

September 30,

2023 % of Revenues September 24,

2022 % of Revenues $ Change % Change

7 unchanged sentences

Total revenues $ 171,575 100.0 % $ 180,869 100.0 % $ (9,294) (5.1) %

Six Months Ended

2023 % of Revenues June 25,

Nine Months Ended

September 30,

2023 % of Revenues September 24,

2022 % of Revenues $ Change % Change

7 unchanged sentences

Total revenues $ 494,939 100.0 % $ 581,950 100.0 % $ (87,011) (15.0) %

Foundry & Logic — The decrease in Foundry & Logic product revenue for the three and six months ended July 1, 2023, compared to the three and six months ended June 25, 2022, was driven by the weaker demand in the semiconductor industry, especially in the personal computer and mobile sectors, that began in the third quarter of fiscal 2022 and has continued into the three and six months ended July 1, 2023 and has resulted in decreased unit sales across the majority of our major customers.

DRAM — The decrease in DRAM product revenue for the three and six months ended July 1, 2023, compared to the three and six months ended June 25, 2022, was driven by lower customer production activity and demand for our products in light of worldwide excess supply of DRAM chips, along with weaker demand in the overall semiconductor industry.

The decline for the six months ended July 1, 2023 was partially offset within the second quarter of fiscal 2023 due to increased demand for high bandwidth memory (“HBM”) chips utilized in artificial intelligence.

Flash — The decrease in Flash product revenue for the three and six months ended July 1, 2023, compared to the three and six months ended June 25, 2022, was driven by lower customer production activity and demand for our products in light of worldwide excess supply, a result of the semiconductor industry's overall demand weakening and Flash market weakness.

Systems — The increase in Systems market revenue for the three and six months ended July 1, 2023, compared to the three and six months ended June 25, 2022, was driven by increased sales of probe stations and cryogenic systems, partially offset by decreased sales of our metrology systems.

Foundry & Logic — The decrease in Foundry & Logic product revenue for the nine months ended September 30, 2023, compared to the nine months ended September 24, 2022, was driven by the weaker demand in the semiconductor industry, especially in the personal computer and mobile sectors, that began in the third quarter of fiscal 2022, has continued into the nine months ended September 30, 2023 and has resulted in decreased unit sales across the majority of our major customers.

The increase in Foundry & Logic product revenue for the three months ended September 30, 2023, compared to the three months ended September 24, 2022, was the result of an increase in unit sales driven by stronger demand in the personal computer sector.

DRAM — The decrease in DRAM product revenue for the three and nine months ended September 30, 2023, compared to the three and nine months ended September 24, 2022, was driven by lower customer production activity and demand for our products in light of worldwide excess supply of DRAM chips, along with weaker demand in the overall semiconductor industry.

These declines for the three and nine months ended September 30, 2023 were partially offset due to increased demand for high bandwidth memory (“HBM”) chips utilized in artificial intelligence.

Flash — The decrease in Flash product revenue for the three and nine months ended September 30, 2023, compared to the three and nine months ended September 24, 2022, was driven by lower customer production activity and demand for our products in light of worldwide excess supply, a result of the semiconductor industry's overall demand weakening and Flash market weakness.

Systems — The increase in Systems market revenue for the nine months ended September 30, 2023, compared to the nine months ended September 24, 2022, was driven by increased sales of probe stations, thermal systems, and cryogenic systems, partially offset by decreased sales of our metrology systems.

The increase in Systems market revenue for the three months ended September 30, 2023, compared to the three months ended September 24, 2022, was driven by increased sales of metrology and thermal systems, partially offset by decreased sales of cryogenic systems.

Revenues by Geographic Region

Three Months Ended Six Months Ended

2023 % of Revenues June 25,

2022 % of Revenues July 1,

Revenue June 25,

Three Months Ended Nine Months Ended

September 30,

2023 % of Revenues September 24,

2022 % of Revenues September 30,

Revenue September 24,

(Dollars in thousands)

10 unchanged sentences

Geographic revenue information is based on the location to which we ship the product.

For example, if a certain South Korean customer purchases through their U.S.

For example, if a certain South Korean customer purchases through its U.S.

subsidiary and requests the products to be shipped to an address in South Korea, this sale will be reflected in the revenue for South Korea rather than the U.S.

Changes in revenue by geographic region for the three and six months ended July 1, 2023, compared to the three and six months ended June 25, 2022, were primarily attributable to changes in customer demand, shifts in customer regional manufacturing strategies, particularly with our large multinational customers, and product sales mix.

Changes in revenue by geographic region for the three and nine months ended September 30, 2023, compared to the three and nine months ended September 24, 2022, were primarily attributable to changes in customer demand, shifts in customer regional manufacturing strategies, particularly with our large multinational customers, and product sales mix.

More specifically, the increase in revenues for the United States, and decreases in revenues for China and Malaysia, were driven principally by a single large U.S.-based company with operations in these regions.

The decrease in revenues for China was also impacted by lowered demand from a large Chinese DRAM integrated device manufacturer and the impact from expanded export license requirements imposed by the United States government in the fourth quarter of fiscal 2022 for exporting advanced U.S.

The decrease in revenues for China was also impacted by lowered demand from a large Chinese DRAM integrated device manufacturer and the impact of expanded export license requirements imposed by the United States government beginning the fourth quarter of fiscal 2022 for exporting advanced U.S.

semiconductor technology to China.

7 unchanged sentences

Three Months Ended

2023 June 25,

September 30,

2023 September 24,

2022 $ Change % Change

1 unchanged sentence

Gross margin 40.4 % 34.4 %

Six Months Ended

2023 June 25,

Nine Months Ended

September 30,

2023 September 24,

2022 $ Change % Change

3 unchanged sentences

Three Months Ended

July 1, 2023 June 25, 2022

September 30, 2023 September 24, 2022

Probe Cards Systems Corporate and Other Total Probe Cards Systems Corporate and Other Total

1 unchanged sentence

Gross margin 38.5 % 51.8 % 40.4 % 34.6 % 53.7 % 34.4 %

Six Months Ended

July 1, 2023 June 25, 2022

Nine Months Ended

September 30, 2023 September 24, 2022

Probe Cards Systems Corporate and Other Total Probe Cards Systems Corporate and Other Total

1 unchanged sentence

Gross margin 36.4 % 51.8 % 38.5 % 43.7 % 52.2 % 43.1 %

Probe Cards — For the three and six months ended July 1, 2023, gross margins decreased compared to the three and six months ended June 25, 2022, primarily due to unfavorable absorption of costs on lower production volumes, greater inventory excess and obsolescence reserves, and lower standard margins related to a less favorable product mix.

Systems — For the three and six months ended July 1, 2023, gross margins increased compared to the three and six months ended June 25, 2022, primarily as a result of higher volume on more favorable product mix.

Probe Cards — For the three months ended September 30, 2023, gross margins increased compared to the three months ended September 24, 2022, primarily due to a more favorable product mix and lower inventory excess and obsolescence reserves, partially offset by greater warranty reserves.

For the nine months ended September 30, 2023, gross margins decreased compared to the nine months ended September 24, 2022, primarily due to lower revenues and unfavorable absorption of costs on these lower production volumes.

Systems — For the three and nine months ended September 30, 2023, gross margins decreased compared to the three and nine months ended September 24, 2022, primarily as a result of a less favorable product mix.

Corporate and Other — Corporate and Other includes unallocated expenses relating to share-based compensation and amortization of intangible assets, inventory and fixed asset fair value adjustments due to acquisitions, and restructuring, which are not used in evaluating the results of, or in allocating resources to, our reportable segments.

Overall — Gross profit and gross margins fluctuate with revenue levels, product mix, selling prices, factory loading, labor costs, and material costs.

For the three and six months ended July 1, 2023, compared to the three and six months ended June 25, 2022, gross profit and gross margins have decreased because of lower revenue levels, unfavorable absorption of costs on lower production volumes, and greater inventory excess and obsolescence reserves.

For the three months ended September 30, 2023, compared to the three months ended September 24, 2022, gross profit and gross margins have increased because of a more favorable product mix and less inventory excess and obsolescence reserves, partially offset by greater warranty reserves.

For the nine months ended September 30, 2023, compared to the nine ended September 24, 2022, gross profit and gross margins have decreased because of lower revenue levels and unfavorable absorption of costs on lower production volumes.

Cost of revenues included stock-based compensation expense as follows (in thousands):

Three Months Ended Six Months Ended

2023 June 25,

Three Months Ended Nine Months Ended

September 30,

2023 September 24,

2022 September 30,

2023 September 24,

Stock-based compensation $ 1,376 $ 1,022 $ 4,801 $ 2,834

1 unchanged sentence

Three Months Ended

2023 June 25,

September 30,

2023 September 24,

2022 $ Change % Change

2 unchanged sentences

% of revenues 18.1 % 14.7 %

Six Months Ended

2023 June 25,

Nine Months Ended

September 30,

2023 September 24,

2022 $ Change % Change

2 unchanged sentences

% of revenues 17.7 % 14.1 %

Research and development expenses in the three and six months ended July 1, 2023 increased when compared to the corresponding period in the prior year primarily due to an increase in headcount to support our continued investment in technology leadership.

Research and development expenses in the three and nine months ended September 30, 2023 increased when compared to the corresponding period in the prior year primarily due to an increase in headcount to support our continued investment in technology leadership.

Increased stock-based compensation from timing of grants, salary adjustments, depreciation, and general operational costs also contributed to the increase.

These increases were partially offset by lower performance-based compensation and project material costs.

A detail of the changes is as follows (in thousands):

Three Months Ended July 1, 2023 compared to Three Months Ended June 25, 2022 Six Months Ended July 1, 2023 compared to Six Months Ended June 25, 2022

Three Months Ended September 30, 2023 compared to Three Months Ended September 24, 2022 Nine Months Ended September 30, 2023 compared to Nine Months Ended September 24, 2022

Employee compensation costs $ 2,343 $ 2,064

Stock-based compensation 1,146 2,200

Project material costs 672 (23)

Employee compensation costs (494) (279)

Depreciation 210 584

Restructuring charges 167 —

Other general operational costs 94 774

$ 4,465 $ 5,599

Research and development included stock-based compensation expense as follows (in thousands):

Three Months Ended Six Months Ended

2023 June 25,

Three Months Ended Nine Months Ended

September 30,

2023 September 24,

2022 September 30,

2023 September 24,

Stock-based compensation $ 3,173 $ 2,027 $ 7,908 $ 5,708

1 unchanged sentence

Three Months Ended

2023 June 25,

September 30,

2023 September 24,

2022 $ Change % Change

2 unchanged sentences

% of revenues 20.7 % 17.5 %

Six Months Ended

2023 June 25,

Nine Months Ended

September 30,

2023 September 24,

2022 $ Change % Change

2 unchanged sentences

% of revenues 20.5 % 16.8 %

Selling, general and administrative expenses decreased in the three and six months ended July 1, 2023 when compared to the corresponding period in the prior year, primarily driven by lower performance-based compensation and a reduction of headcount, partially offset by higher stock-based compensation, consulting fees, and general operating expenses.

Selling, general and administrative expenses increased in the three and nine months ended September 30, 2023 when compared to the corresponding period in the prior year.

The drivers of the increase for the three month period were increased consulting fees related to the divestiture of FRT, stock-based compensation from timing of grants, performance-based compensation, and general operating expenses, partially offset by lower headcount and amortization of intangibles from significant intangibles becoming fully amortized.

The drivers of the increase for the nine month period were increased consulting fees related to the divestiture of FRT, stock-based compensation from timing of grants, and general operating expenses, partially offset by lower performance-based compensation, headcount, and amortization of intangibles from significant intangibles becoming fully amortized.

A detail of the changes is as follows (in thousands):

Three Months Ended July 1, 2023 compared to Three Months Ended June 25, 2022 Six Months Ended July 1, 2023 compared to Six Months Ended June 25, 2022

Employee compensation $ (2,812) $ (5,185)

Stock-based compensation 1,397 1,949

Three Months Ended September 30, 2023 compared to Three Months Ended September 24, 2022 Nine Months Ended September 30, 2023 compared to Nine Months Ended September 24, 2022

Consulting fees $ 2,539 $ 3,357

Stock-based compensation 1,344 3,293

Amortization of intangibles (1,090) (1,099)

General operating expenses 599 1,965

Employee compensation 535 (4,650)

Restructuring charges — 746

1 unchanged sentence

Selling, general and administrative included stock-based compensation expense as follows (in thousands):

Three Months Ended Six Months Ended

2023 June 25,

Three Months Ended Nine Months Ended

September 30,

2023 September 24,

2022 September 30,

2023 September 24,

Stock-based compensation $ 6,290 $ 4,946 $ 16,624 $ 13,331

1 unchanged sentence

Interest income is earned on our cash, cash equivalents, restricted cash and marketable securities.

The increase in interest income for the three and six months ended July 1, 2023 compared with the corresponding period of the prior year was attributable to an increase in investment yields due to the higher interest rate environment.

The increase in interest income for the three and nine months ended September 30, 2023 compared with the corresponding period of the prior year was attributable to an increase in investment yields due to the higher interest rate environment.

Interest expense primarily includes interest on our term loan, interest rate swap derivative contracts, and term loan issuance costs amortization charges.

The interest expense for the three and six months ended July 1, 2023 compared to the same period of the prior year decreased due to lower outstanding debt.

The interest expense for the three and nine months ended September 30, 2023 compared to the same period of the prior year decreased due to lower outstanding debt.

Other Income, Net

2 unchanged sentences

Provision for Income Taxes

Three Months Ended Six Months Ended

2023 June 25,

Three Months Ended Nine Months Ended

September 30,

2023 September 24,

2022 September 30,

2023 September 24,

(In thousands, except percentages)

Provision (benefit) for income taxes $ (208) $ 3,136 $ (160) $ 7,586

Provision for income taxes $ 786 $ 1,274 $ 626 $ 8,860

Effective tax rate 15.2 % 22.6 % 8.7 % 12.1 %

2 unchanged sentences

Our effective tax rate may vary from period to period based on changes in estimated taxable income or loss by jurisdiction, changes to the valuation allowance, changes to U.S.

federal, state or foreign tax laws, changes in ASC 718 stock-based compensation expense/benefit, future expansion into areas with varying country, state, and local income tax rates, and deductibility of certain costs and expenses by jurisdiction.

The decrease in our effective tax rate for the three and six months ended July 1, 2023, when compared to the corresponding period in the prior year, was primarily driven by a change within the second quarter of fiscal 2023 to the estimated annual taxable income, including by jurisdiction.

federal, state or foreign tax laws, changes in stock-based compensation expense/benefit, future expansion into areas with varying country, state, and local income tax rates, and deductibility of certain costs and expenses by jurisdiction.

The decrease in our effective tax rate for the three months ended September 30, 2023, when compared to the corresponding period in the prior year, was primarily driven by higher than normal effective rates for the three months ended September 24, 2022 as a result of a rapid change in expected 2022 taxable income driven by the weaker demand in the semiconductor industry in the second half of fiscal year 2022, as described previously.

The decrease in our effective tax rate for the nine months ended September 30, 2023, when compared to the corresponding period in the prior year, was primarily driven by relatively higher benefits from FDII and U.S.

tax credits as compared to taxable income, resulting from higher Research and development spending and lower taxable income in the U.S.

for the nine months ended September 30, 2023.

The Creating Helpful Incentives to Produce Semiconductors and Science Act of 2022 (“CHIPS Act”) was signed into law on August 9, 2022.

9 unchanged sentences

Capital Resources

Our working capital was $354.2 million at July 1, 2023, compared to $324.9 million at December 31, 2022.

Our working capital was $377.1 million at September 30, 2023, compared to $324.9 million at December 31, 2022.

Cash and cash equivalents primarily consist of deposits held at banks and money market funds.

4 unchanged sentences

Our investment policy requires investments to be rated single A or better, and limits the types of acceptable investments, issuer concentration and duration of the investment.

Our cash, cash equivalents and marketable securities totaled approximately $236.9 million at July 1, 2023, compared to $238.1 million at December 31, 2022.

Our cash, cash equivalents and marketable securities totaled approximately $244.4 million at September 30, 2023, compared to $238.1 million at December 31, 2022.

Based on our historical results of operations, we expect that our cash, cash equivalents, and marketable securities on hand, and the cash we expect to generate from operations, will be sufficient to fund our short-term and long-term liquidity requirements primarily arising from:

9 unchanged sentences

The following table sets forth our net cash flows from operating, investing and financing activities:

Six Months Ended

2023 June 25,

Nine Months Ended

September 30,

2023 September 24,

(In thousands)

1 unchanged sentence

Net cash used in investing activities $ (49,994) $ (52,013)

Net cash provided by (used in) financing activities $ 4,049 $ (57,263)

Net cash used in financing activities $ (1,308) $ (84,964)

Operating Activities

Net cash provided by operating activities for the six months ended July 1, 2023 was attributable to net income of $2.2 million and net non-cash expenses of $49.1 million, which includes depreciation, amortization, stock-based compensation, and the provision for excess and obsolete inventories, partially offset by an increase in net working capital of $16.5 million.

The increase in net working capital related to decreases in accrued liabilities and deferred revenues of $10.6 million and $9.9 million, respectively, and increases in accounts receivable and inventory of $6.8 million and $5.9 million, respectively, partially offset by an increase in deferred grant of $18.0 million.

Net cash provided by operating activities for the nine months ended September 30, 2023 was attributable to net income of $6.5 million and net non-cash expenses of $71.5 million, which includes depreciation, amortization, stock-based compensation, and the provision for excess and obsolete inventories, partially offset by an increase in net working capital of $22.7 million.

The increase in net working capital is related to decreases in deferred revenues and accrued liabilities of $12.9 million and $5.3 million, respectively, and increases in inventory, net and accounts receivable, net of $8.9 million and $7.8 million, respectively, partially offset by an increase from a deferred grant of $18.0 million.

Investing Activities

Net cash used in investing activities for the six months ended July 1, 2023 primarily related to $40.2 million in property, plant and equipment purchases and $8.3 million in net purchases of marketable securities.

Net cash used in investing activities for the nine months ended September 30, 2023 primarily related to $46.1 million in property, plant and equipment purchases and $3.9 million in net purchases of marketable securities.

Financing Activities

Net cash provided by financing activities for the six months ended July 1, 2023 primarily related to $5.0 million received from issuances of common stock under our employee stock purchase plan, partially offset by $0.5 million principal payments made towards the repayment of our term loan and $0.5 million related to tax withholdings associated with the net share settlements of our equity awards.

Net cash used in financing activities for the nine months ended September 30, 2023 primarily related to $9.3 million tax withholding payments associated with the net share settlements of our equity awards and $0.8 million principal payments made towards the repayment of our term loan, partially offset by $8.8 million received from issuances of common stock under our employee stock purchase plan.

Building Term Loan

4 unchanged sentences

Interest payments are payable in monthly installments over a fifteen-year period.

The interest rate at July 1, 2023 was 5.17%.

As of July 1, 2023, the balance outstanding pursuant to the Building Term Loan was $15.0 million.

The interest rate at September 30, 2023 was 7.19%.

As of September 30, 2023, the balance outstanding pursuant to the Building Term Loan was $14.7 million.

On March 17, 2020, we entered into an interest rate swap agreement to hedge the interest payment on the Building Term Loan for the notional amount of $18.0 million, and an amortization period that matches the debt.

1 unchanged sentence

By entering into the agreement, we converted a floating-rate interest at one-month LIBOR plus 1.75% into a fixed-rate interest at 2.75%.

This agreement was amended on May 19, 2023 to replace the benchmark reference rate LIBOR with the term SOFR to match the Building Term Loan agreement (as amended).

This agreement was amended on May 19, 2023 to replace the benchmark reference rate LIBOR with SOFR to match the Building Term Loan agreement (as amended).

After the amendment, the interest rate swap continues to convert our floating-rate interest into a fixed-rate at 2.75%.

As of July 1, 2023, the notional amount of the loan that is subject to this interest rate swap is $15.0 million.

As of September 30, 2023, the notional amount of the loan that is subject to this interest rate swap is $14.7 million.

Stock Repurchase Programs

On October 26, 2020, our Board of Directors authorized a two-year program to repurchase up to $50 million of outstanding common stock to offset potential dilution from issuances of common stock under our stock-based compensation programs.

During the six months ended June 25, 2022, we repurchased 676,408 shares of common stock for $26.0 million.

During the nine months ended September 24, 2022, we repurchased 676,408 shares of common stock for $26.0 million.

We utilized the remaining funds available for repurchase under this program during fiscal 2022.

1 unchanged sentence

The share repurchase program will expire on May 20, 2024.

During the six months ended July 1, 2023, we did not repurchase any shares of common stock.

As of July 1, 2023, $18.6 million remained available for future repurchases.

During the nine months ended September 30, 2023, we did not repurchase any shares of common stock.

As of September 30, 2023, $18.6 million remained available for future repurchases.

On October 30, 2023, our Board of Directors authorized an additional program to repurchase up to $75 million of outstanding common stock, also with the primary purpose of offsetting potential dilution from issuance of common stock under our stock-based compensation programs.

The share repurchase program will expire on October 30, 2025.

Contractual Obligations and Commitments

The following table summarizes our significant contractual commitments to make future payments in cash under contractual obligations as of July 1, 2023:

The following table summarizes our significant contractual commitments to make future payments in cash under contractual obligations as of September 30, 2023:

Payments Due In Fiscal Year

9 unchanged sentences

Historically, we have not participated in transactions that have generated relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities, which would have been established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes.

As of July 1, 2023, we were not involved in any such off-balance sheet arrangements.

As of September 30, 2023, we were not involved in any such off-balance sheet arrangements.

Recent Accounting Standards

1 unchanged sentence

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis